As the second half of the year begins, leading AI company stocks in the Hong Kong market have seen a recovery, with Alibaba-W (BABA-W), Tencent Holdings (00700), and Baidu Group-SW (BIDU-SW) experiencing consecutive days of share price rebounds.
Analysis from China Securities indicates that top-tier companies are driving down the marginal costs of large model inference through optimizations in their underlying architectures. This is accelerating the formation of a commercial ecosystem for AI applications in high-frequency business-to-business scenarios.
Looking back at the first half of the year, a stark "K-shaped" divergence was evident among domestic large model players. Newcomers like Zhipu saw its share price surge by 1710.67% following its initial public offering, while MINIMAX-W rose 152.73% and Xunce gained 141.19%. In sharp contrast, established leaders faced collective stock price pressure due to capital expenditures eroding profits: Alibaba-W fell 34.40%, Kuaishou-W dropped 33.83%, Meituan-W declined 33.69%, Tencent Holdings decreased 27.41%, and Baidu Group-SW was down 16.65%. Currently, Zhipu's market capitalization stands at approximately HKD 800 billion, while Baidu Group, with its diverse operations in search engines, autonomous driving, self-developed chips, and the Ernie large model, has a market cap of only around HKD 300 billion, suggesting its shares may be significantly undervalued.
Recent developments indicate a reshaping of the global large model landscape. According to a report from analytics firm Sensor Tower, OpenAI's ChatGPT has seen its share of the global AI assistant market fall below 50% for the first time, as more competitors emerge. The market structure is rapidly shifting from single-player dominance to a more competitive, multi-player field. Microsoft's CEO has recently called for breaking up tech giant monopolies, advocating for cheaper models and enhanced user choice. Reports suggest the company is considering adopting open-source models like China's DeepSeek V4 to reduce costs.
In the early stages of the AI industry, investor preference has leaned towards upstream materials and hardware with stronger profit certainty, as well as new large model companies like Zhipu and MiniMax. Consequently, the Hang Seng Internet & Information Technology Index has corrected nearly 45% since October last year. The index's current valuation (PE-TTM) is 19.4 times, sitting at the 8.54th percentile of its range over the past decade—meaning it is cheaper than it was 92% of the time in the last ten years, presenting a relatively attractive valuation.
Information shows that the ChinaAMC Hang Seng Internet ETF (513330.SH), listed on the A-share market, is the largest ETF tracking the Hang Seng Internet & Information Technology Index. This index is considered the purest "AI application" index in the Hong Kong market, with an AI concentration of about 95%. It also has the highest weighting for BAT (Baidu, Alibaba, Tencent) stocks among Hong Kong indices, with a combined weight of 37%. Its constituents include not only large model companies like Alibaba-W, Tencent Holdings, Kuaishou-W, Baidu Group-SW, and Xiaomi Group-W, but also vertical application platforms like Kingsoft Software and Meitu. Investors without direct securities trading access can also participate through the associated feeder fund: ChinaAMC Hang Seng Internet ETF Link C (013172.OF).